Standard Chartered, one of the largest banks in the world with over $840 billion in assets, has announced that it will launch a Bitcoin and cryptocurrency custody service for institutional clients in Dubai. The service, which will be operated by its digital asset subsidiary Zodia Custody, will enable clients to securely store and transfer their crypto assets, as well as access other services such as lending, trading and staking.
The bank said that the move is part of its strategy to embrace digital innovation and meet the growing demand for crypto assets in the Middle East region. Dubai is a global hub for fintech and blockchain and has recently introduced a regulatory framework for crypto service providers. Standard Chartered said that it has obtained the necessary approvals from the Dubai Financial Services Authority (DFSA) to launch the service, which will be available in the first quarter of 2022.
Zodia Custody was established in 2020 as a joint venture between Standard Chartered and Northern Trust, a leading global custodian. The company leverages the expertise and infrastructure of both partners to provide a secure and compliant custody solution for Bitcoin, Ethereum, XRP, Litecoin and Bitcoin Cash. Zodia Custody is also registered with the UK Financial Conduct Authority (FCA) and follows the highest standards of governance, risk management and compliance.
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Standard Chartered is not the only major bank to enter the crypto custody space. Earlier this year, BNY Mellon, the world’s largest custodian with over $41 trillion in assets under custody, announced that it will offer crypto custody services to its clients. Other banks such as JPMorgan, Goldman Sachs and Citi have also expressed interest or launched initiatives to cater to the growing institutional demand for crypto assets.
The launch of Standard Chartered’s crypto custody service in Dubai is a significant milestone for the adoption of crypto assets in the region and beyond. It shows that traditional financial institutions are recognizing the potential and value of crypto assets and are willing to invest in the infrastructure and capabilities to support them.
It also signals that regulators are becoming more open and supportive of crypto innovation and are creating a conducive environment for its development. As more banks and institutions enter the crypto space, we can expect to see more innovation, competition and growth in the industry.
$1.5 Trillion Invesco partners with Galaxy Digital to file for a spot Bitcoin ETF
In a major development for the crypto industry, Invesco, one of the world’s largest asset managers with $1.5 trillion in assets under management, has teamed up with Galaxy Digital, a leading crypto-focused financial services firm, to file for a spot Bitcoin ETF with the US Securities and Exchange Commission (SEC).
A spot Bitcoin ETF is a type of exchange-traded fund that tracks the price of Bitcoin directly, rather than through derivatives or trusts. This means that the fund would hold actual Bitcoin in custody and allow investors to gain exposure to the cryptocurrency without having to buy, store, or manage it themselves.
The Invesco Galaxy Bitcoin ETF, as the proposed fund is called, would be the first of its kind in the US market, where the SEC has so far rejected or delayed all applications for spot Bitcoin ETFs, citing concerns over market manipulation, fraud, and investor protection. However, the Invesco-Galaxy partnership may have an edge over previous applicants, as both firms have extensive experience and expertise in the crypto space.
Invesco is already the sponsor of several crypto-related products, such as the Invesco Elwood Global Blockchain Equity UCITS ETF and the Invesco Galaxy Crypto Economy ETF, which invest in companies that are involved in or benefit from blockchain technology and digital assets. Galaxy Digital, founded by former hedge fund manager and Bitcoin bull Mike Novogratz, is a diversified financial services firm that offers asset management, trading, advisory, and investment banking services for the crypto industry. Galaxy Digital also serves as the sub-adviser and custodian for several Bitcoin funds in Canada, where spot Bitcoin ETFs have been approved and launched earlier this year.
The Invesco Galaxy Bitcoin ETF would charge a 0.65% annual fee and trade on the NYSE Arca exchange, according to the filing. The fund would use the Bloomberg Galaxy Bitcoin Index as its benchmark, which is calculated based on prices from various crypto exchanges. The fund would also employ various risk management and security measures to ensure the safekeeping of its Bitcoin holdings, such as cold storage, multi-signature wallets, encryption, insurance, and audits.
The filing comes at a time when Bitcoin is trading near its all-time high of over $66,000, driven by strong demand from institutional and retail investors, as well as growing adoption and innovation in the crypto space. The approval of a spot Bitcoin ETF in the US would be a significant milestone for the crypto industry, as it would provide a more accessible and regulated way for investors to access the largest and most popular cryptocurrency in the world.